Seat No: ______________ Enrollment No: _____________

PARUL UNIVERSITY
FACULTY OF MANAGEMENT
MBA Supplementary Examination, Summer 2015-16

Semester: I Date: 05/05/2016

Subject Code: 06200104 Time: 2.00pm to 5.00pm
Subject Name: Accounting For Managers Total Marks: 60
Instructions:
1. Attempt all questions from each section.
2. Figures to the right indicate full marks.
3. Make suitable assumptions wherever necessary.
4. Write separate sections on separate answer sheets.

SECTION-A
Q.1 (a) Answer the following MCQs. (03)
1. Which of the following is a selling expense?
A) Any tax/freight is paid on purchases
B) General salaries paid to laborers
C) Tax & freight paid on sale
D) Interest on loan
2. Which of the following is NOT an item of a Balance Sheet?
A) Accounts Receivable
B) Accounts Payable
C) Sales Revenue
D) Marketable Securities
3. We can say that the business is in profit, when:
A) Assets exceed Expenditure
B) Income exceeds Liabilities
C) Income exceeds Expenditure
D) Assets exceeds Liabilities

Q.1 (b) Define the following terms. (03)

1. Conservatism Concept
2. Entity Concept
3. Realization Concept

Q.2 Mr. Dorai Raj, the proprietor of Hindustan Enterprises presents the following trial balance for the (08)
financial year 2009-2010 and the data regarding adjustment.

Particulars Dr (Rs) Cr (Rs)

Cash 17,125
Accounts Receivable 35,000
Supplies 6,350
Prepaid Insurance 3,100
Office Equipment 2,58,250
Accumulated Depreciation 48,500
Account payable 4,625
Unearned Fees 6,250
Dorai Raj's Capital 1,45,000
Dorai Raj's Drawing 26,000
Fees Earned 2,95,625
Wages 1,12,075
rent 21,000
Utilities Expenses 13,575
Miscellaneous Expenses 7,525
5,00,000 5,00,000
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 The Data needed to determine year end adjustments are as follows:
i) Supplies on hand at March 31, 2010 are Rs. 1,900
ii) Insurance Premiums expired during the year are Rs. 1,575
iii) Depreciation of equipment during the year is Rs.24,750
iv) Wages accrued but not paid at March 31, 2010 are Rs.220
v) Accrued fees earned but not recorded at March 31, 2010 are 5,000
vi) Unearned fees on March 31, 2010 are 3,750
Prepare Trading account, P&L Account and Balance sheet for the Company.

Q.3 (a) Assume an Innova’s Cost is Rs. 16,00,000, its estimated life is 5 years, Salvage value is Rs. (04)
1,00,000. Calculate the depreciation under WDV method and prepare a statement of depreciation
charge for five years (Rate of Depreciation is 20%).

Q.3 (b) Write Short Note on : Disclosure of Accounting Policies (AS-1) (03)

OR
Q.3 (a) From the following information you are required to calculate the value of Ending inventory and (04)
cost of goods sold under weighted average method.

Date Transaction Units Price per Unit RS

Nov,2,2015 Opening Balance 100 10
Nov,9,2015 Purchase 400 15
Nov,14,2015 Sold 300 -
Nov,25,2015 Purchase 500 20
Nov,29,2015 Sold 400 -

Q.3 (b) Write Short Note on : Accounting for Investments (AS-13) (03)

Q.4 1. Journalize the following transactions (03)

i) Mr. Yogesh started business with Rs 25,000
ii) Purchased goods from Mr. Anil Rs 2,500
iii) Paid wages Rs 4,000

2. GAAP v/s IFRS (03)

3. Show the name of Accounting Concept and Conventions through the Chart. (03)

SECTION B

Q.1 (a) Answer the following MCQs. (03)

1. Cash flow statement is based upon _________ while Funds Flow Statement recognizes
_______.
A) Cash basis of accounting, accrual basis of accounting
B) Accrual basis of accounting, cash basis of accounting
C) Both are based on cash basis of accounting
D) None of the above

2. In calculating earnings per share (EPS), the net profit is divided by which of the
following?
A) Number of ordinary shares
B) Number of preference shares
C) Paid up capital

2
 D) Authorized Capital

3. _____ has/have accepted cash flow statement is more useful than funds flow statement,
particularly from view of analysis of liquidity of a firm.
A) Institute Of Chartered Accountants of India
B) FASB, America
C) SEBI
D) All of the above

Q.1 (b) Write Formulas of the following Ratios. (03)

1. Debtor’s Turnover Ratio
2. ROI
3. Overall Profitability Ratio

Q.2 From the Balance Sheets of Aabha Ltd. Prepare a Cash Flow Statement (Direct or Indirect (08)
Method).
Liabilities 2008 (Rs) 2009 (Rs) Assets 2008 (Rs) 2009 (Rs)
Fixed
Equity Share Capital 3,00,000 4,00,000 Assets 4,00,000 5,50,000
Profit and Loss A/C 85,000 1,10,000 Stock 2,00,000 2,25,000
Bank Loan 1,00,000 75,000 Debtors 2,10,000 1,90,000
Accumulated Bills
Depreciation 80,000 1,35,000 receivable 80,000 1,10,000
Creditors 3,10,000 2,95,000 Bank 30,000 -
Proposed Dividend 45,000 60,000
9,20,000 10,75,000 9,20,000 10,75,000

Additional Information: A Piece of Machinery costing Rs 60,000 on which accumulated

depreciation was Rs 15,000 was sold for Rs 30,000.

Q.3 (a) From the following information prepare the statement of Funds from Operation: (04)

Particulars 31-3-2014 31-03-2015 (Rs)

(Rs)
Profit and Loss A/C 3,00,000 2,80,000
Accumulated Depreciation 20,000 26,000
General Reserve 1,00,000 1,25,000
Goodwill 65,000 50,000

During the year, building was sold at a profit of Rs 20,000

Q.3 (b) Define Inflation. Discuss the Inflation Accounting in detail. (03)

OR

Q.3 (a) Discuss the contemporary methods of HR Accounting. (04)

Q.3 (b) Write a Short note on : Social Responsibility Accounting. (03)

Q.4. The following is the balance sheet of Prashant Ltd as on 31st March 2006.

Balance Sheet of Prashant Ltd (09)

As of March 2006
Liabilities Rs Asses Rs
Share Capital Fixed Assets (Less Depreciation) 6,10,000
Equity shares of Rs 10 each -
4,00,000
1000 12% Preference shares of Current Assets:
Rs 100 each – 1,00,000 5,00,000 Stock-in-trades – 1,60,000
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Reserve and Surplus 2,80,000 Sunday Debtors – 1,20,000
12% Debenturs 20,000 Bill Receivable – 25,000
Current Liabilities Cash in hand and bank – 35,000
Creditors 1,20,000 3,40,000
Bank OD – 30,000 1,50,000
9,50,000 9,50,000
Revenue Statement
For the year ended 31st March 2006
Particulars Rs Rs
Net Sales 7,30,000
Cost of Sales 6,20,500
Gross Profit 1,09,500
Administrative Expenses 18,250
Selling and Distribution Expenses 36,500 54,750
Operating Profit (Before Tax) 54,750
Taxation 25,550
Operating Profit (After Tax) 29,200
From the above information, you are required to compute the following Ratios:
i) Current Ratio
ii) Liquid Ratio
iii) Gross Profit Ratio
iv) Debtors’ Turnover Ratio
v) Net Profit Ratio
vi) Acid Test Ratio
vii) Creditors’ Turnover Ratio
viii) Stock Working Capital Ratio
ix) Total Asset Turnover Ratio